Public Accounts Committee on Oct. 19th, 2023

[Karen Hogan]

I have to admit I'm perplexed as to why, after 24 years, the government still has no overarching modernization strategy. That's why I think progress is so slow.

Individually, departments are putting money towards modernization, but it comes out of their existing budgets. Our government-wide survey of chief information officers revealed that their ability to modernize their systems is hindered by the lack of funding to really support IT modernization.

As for the three benefit delivery systems we took a closer look at, all investments were really aimed at building the foundation—migrating data to a cloud platform and making sure the three benefit systems are built on a stable environment.

Yes, real progress has been made, but the government doesn't appreciate the size of the investment needed to modernize the systems.

[Nathalie Sinclair-Desgagné, Bloc, Terrebonne, QC]

This is more of a complex question, but I would appreciate a short answer. Are those benefit delivery systems at risk of collapsing, yes or no?

[Karen Hogan]

Absolutely. With each day that the systems aren't modernized, there is a risk.

[Nathalie Sinclair-Desgagné, Bloc, Terrebonne, QC]

Could the system collapse next week, depriving those most vulnerable of the benefits they depend on?

[Karen Hogan]

I can tell you that the government is putting a tremendous amount of time and money right now into stabilizing the system and ensuring the continuity of benefits to recipients, but it remains a concern. The systems are between 20 and 60 years old. It's like an old car. You can drive it, but it costs a lot to keep it running.

[Nathalie Sinclair-Desgagné, Bloc, Terrebonne, QC]

It could stop running, though.

[Karen Hogan]

It's not always reliable.

[The Chair, Conservative, John Williamson]

Thank you very much.

Mr. Desjarlais, you have the floor for three minutes, please.

[Blake Desjarlais, NDP, Edmonton Griesbach, AB]

Thank you very much, Chair.

I would like to follow up on two reports this time, in particular as they pertain to racism.

Report five speaks directly to racism in the workplace. You audited several places. In particular, six organizations were under review—Canada Border Services Agency, Correctional Service Canada, Department of Justice, Public Prosecution Service of Canada, Public Safety Canada and the Royal Canadian Mounted Police. In that audit, you mentioned there was also a process where racialized folks were interviewed. In those interviews, they expressed that they perceived “a lack of true commitment to equity, diversity, and inclusion” and expressed that “meaningful change” had not been achieved.

This is something that I hear often from constituents, particularly constituents who work in the public service—and not just in these six organizations. Although there are six organizations present here for which there has been testimony that there has not been meaningful change, I would argue that, in IRCC, the same exists as well. I know that the nature of this audit doesn't expand to IRCC particularly, but I do believe it is likely important and it likely persists there as well.

In particular, I look at some of the offices that were under capacity. You mentioned capacity being one of the issues. One area there, section 9.48 of the IRCC report, suggests that there is a lack of capacity in sub-Saharan African offices. Has your work ever taken into account racism within IRCC, in particular in relation to where capacity goes and where refugees or applications stem from? Do you think that is likely a contributor to how some decisions are made, or how some applications may even be delayed?

[Karen Hogan]

I'll try to address both of those reports in my response.

In the report where we looked at inclusion in the workplace, while we did only go to six departments and it is absolutely just a sample of the public service, I think it should serve as an alarm bell to everyone across the public service to have leaders really ask themselves if they are taking real and concrete steps toward improving inclusion. We found in that audit that most of those organizations focused on meeting employment equity targets, which is just step one. It is not really ensuring that racialized employees feel valued and welcomed in the workplace.

While it's just six, I think the entire public service should care about our findings and should take action following them.

I'll turn now to Immigration, Refugees and Citizenship Canada and our audit on the processing of permanent resident applications. I'll tell you that the deputy minister has acknowledged that systemic discrimination exists in her organization. In fact, a recent internal audit that was published on their website highlights that employees are raising discriminatory practices in the processing of applications. We found that there really are differential outcomes, but the organization was not analyzing their outcomes in that way. They weren't looking at the results based on race or country.

We did that for them in the audit. We made recommendations for them to better understand that. One of the big causes is where things are routed for processing, but knowing why and understanding the differential outcomes is the first place to start.

[The Chair, Conservative, John Williamson]

Thank you very much. That is the time for Mr. Desjarlais.

Ms. Kusie, you have the floor for three minutes.

[Stephanie Kusie, Conservative, Calgary Midnapore, AB]

Thank you, Chair.

Thank you all for being here today. It's been 24 years since it was recognized that aging infrastructure was a critical issue. This current government has yet to present a strategy, a main plan for driving modernization.

What would you say the primary reason for that is?

[Karen Hogan]

Do you mean the primary reason for not having a strategy?

[Stephanie Kusie, Conservative, Calgary Midnapore, AB]

That's correct.

[Karen Hogan]

I don't know. It's perplexing. As I said earlier—

[Stephanie Kusie, Conservative, Calgary Midnapore, AB]

It is.

[Karen Hogan]

—in 1999, aging infrastructure was identified by the government as a problem. We did an audit in 2010 that reiterated that. Decades of chronic underfunding has brought the government to such a place. I think there needs to be better leadership globally to see a change here. There needs to be better information around exactly how many systems need to be modernized and how many are not needed anymore. More importantly, we have to look at the funding mechanisms, which are poorly suited to major IT projects. There are lots of good recommendations for the government to work on.

[Stephanie Kusie, Conservative, Calgary Midnapore, AB]

Thank you.

A theme, Auditor General, throughout your reports is not collecting data and not using data that has been collected.

Why, would you say, is this government not doing a better job of collecting and using data in an effort to provide better services for Canadians and to provide better value for Canadians?

[Karen Hogan]

I guess I could use the inclusive public service report as an example. For decades there have been commitments around improving employment equity. There's been a flurry of activity and really good things that have resulted from the public service really being representative of the Canadian population. However, for decades we, as a government, haven't been gathering information along racial lines, splitting up visible minorities into different categories. There are different lived experiences, and there are different reasons and barriers. I think that's an issue we see in terms of inclusion. We see it in IT. We see it in so many other programs. I think everyone is on the cusp of really understanding that data is key and essential. It's part of our job to point out when it could be used better to drive more meaningful change.

[Stephanie Kusie, Conservative, Calgary Midnapore, AB]

That's excellent. Thank you.

This will be my final question. In 2021, Auditor General, the secretariat estimated that it would cost $496 million to modernize all of the applications, yet, in November of 2022, an external third party increased this amount to between $2.7 billion and $3.4 billion.

Would you say we're able to quantify the cost of inaction and further delays by this government?

[Karen Hogan]

I think what that points out is that there really are some missing skills and capacity in being able to identify the real costs of such a large initiative. The three systems we're talking about here, which are old age security, Canada pension plan and the employment insurance program, have existed for 20 to 60 years. They're old. There is so much complexity from a policy perspective. There's a lot that needs to be factored into what modernizing and improving these systems looks like. There has been some positive in that the government has taken external advice now and they're looking at this, but what's even more concerning is that they don't have a full picture of how much it will cost. Across the public service 7,500 applications have been identified as needing to be modernized. The costs are underestimated at this time.

It's about having a better skill set to be able to estimate it, but then it's also adjusting funding mechanisms to deal with the fact that major IT projects are lengthy. How is the funding going to be adaptable in order to deal with the increasing costs that are inevitable as you take time to put something forward?

[The Chair, Conservative, John Williamson]

Thank you very much.

Our last colleague is Ms. Khalid.

You have the floor for approximately three minutes.

[Iqra Khalid, Liberal, Mississauga—Erin Mills, ON]

Thank you very much, Chair.

Thank you, Auditor General and the whole team, for this very extensive and good audit here.

Speaking of modernizing systems, I just want to pick up on our IT systems.

Do you think there should be one fulsome system that covers all of our departments and agencies, or do you think having these separate individual systems at each department is a better approach?

[Karen Hogan]

This feels like a really foundational question. I could even draw an analogy as to whether you buy or lease a car. I think it really depends on the outcome, the objectives and the means whether we have decentralized or centralized. That is a big question. The federal government is huge. There are so many systems that do very different things that I think it would be almost impossible to have one system that would provide all of the services across the country.

Is there opportunity to consolidate and streamline? Absolutely. I think that's part of having a good picture of what these 75 applications do.

Which are needed? Which should be retired? How do you modernize the public service going forward? My advice is don't lose sight of the outcome, which is improving service delivery to Canadians.

[Iqra Khalid, Liberal, Mississauga—Erin Mills, ON]

Other than funding or resources, are there other concerns with IT modernization, like security? We see security breaches or data being stolen in private companies, as well as in some governments. What are your thoughts on that piece?